Simple measures, such as differences in standardized test scores, account for as much as one-third of the differences in home values between communities. So, measuring school quality should be a central goal of state policymakers.
One key challenge in evaluating school quality is that households choose their schools. Family characteristics play a huge role in the performance of local schools on standardized tests. So, if you wish to understand how well a school performs, you have to account for the kinds of families it serves — because schools don’t get to choose their students.
Fortunately, there’s abundant data on each school corporation. We know the enrollment size, as well as the race and ethnicity of students in every Indiana school. We know how many are labeled as English language learners because they speak another language at home. These data provide us with a way to isolate schools’ contributions to outcomes from families’ contributions.
We can also add measures of poverty, such as the share of students eligible for the free and reduced-price lunch program and per-student spending, which is adjusted upward based on three measures of poverty or family hardship.